Which of the Following Organizations Faces Higher Switching Costs

question 68

Multiple Choice

Which of the following organizations faces higher switching costs?

• A)an organization that wants to automate its processes
• B)an organization that moves it data center to cloud storage
• C)an organization that buys an information system to manage its own records
• D)an organization that wants to switch to open-source software

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Definitions:

Uncertainty

The state of having limited knowledge where it is impossible to exactly describe existing state or future outcomes, often affecting decision-making processes.

Budgeted Profit and Loss Statement

A financial statement forecasting the revenue, expenses, and profit for a future period, based on management's estimates.

Operating Expenses

Ongoing expenses for operating a business, excluding the cost of goods sold but including costs like rent, utilities, and payroll.

Budgetary Slack

The practice of underestimating revenues or overestimating costs when preparing a budget, to create a buffer that makes budget targets easier to achieve.